TIDMAAZ
RNS Number : 1662L
Anglo Asian Mining PLC
17 July 2017
Anglo Asian Mining plc / Ticker: AAZ / Index: AIM / Sector:
Mining
17 July 2017
Anglo Asian Mining plc
Q2 & HY1 2017 Production Update and Operations Review
Gedabek Gold, Copper and Silver mine, Azerbaijan
Anglo Asian Mining plc ("Anglo Asian" or "the Company"), the AIM
listed gold, copper and silver producer focused in Azerbaijan, is
pleased to provide an operations and production update for its
Gedabek gold, copper and silver mine ("Gedabek") in western
Azerbaijan for the three months to 30 June 2017 ("Q2 2017") and the
six months to 30 June 2017 ("HY1 2017").
Note that all references to "$" are to United States
dollars.
Production overview
Q2 2017
-- Gold production for Q2 2017 totalled 12,140 ounces - 9,131
ounces contained within gold doré, 4 ounces from SART processing
and 3,005 ounces from flotation (Q1 2017: total 11,078 ounces)
-- Copper production for Q2 2017 totalled 716 tonnes - 187
tonnes from SART processing and 529 tonnes from flotation (Q1 2017:
total 606 tonnes)
-- Silver production for Q2 2017 totalled 45,718 ounces - 3,266
ounces contained within gold doré, 4,717 ounces from SART
processing and 37,735 ounces from flotation (Q1 2017: total 39,369
ounces)
-- Total production for Q2 2017 expressed as gold equivalent
ounces of 14,775 ounces (Q1 2017: 13,779 gold equivalent
ounces)
HY1 2017
-- Gold production for HY1 2017 totalled 23,218 ounces - 18,389
ounces contained within gold doré, 9 ounces from SART processing
and 4,820 ounces from flotation (HY1 2016: total 33,837 ounces)
-- Copper production for HY1 2017 totalled 1,322 tonnes - 397
tonnes from SART processing and 925 tonnes from flotation (HY1
2016: total 969 tonnes)
-- Silver production for HY1 2017 totalled 85,087 ounces - 5,713
ounces contained within gold doré, 10,240 ounces from SART
processing and 69,134 ounces from flotation (HY1 2016: total 90,782
ounces)
-- Total production for H1 2017 expressed as gold equivalent
ounces of 28,554 ounces (H1 2016: 36,729 gold equivalent
ounces)
FY 2017
-- Target production for the 12 months to 31 December 2017
expressed as gold equivalent ounces remains at between 64,000
ounces and 72,000 ounces compared to FY 2016 actual total
production of 72,304 gold equivalent ounces
Sales overview
-- Q2 2017 gold bullion sales of 7,406 ounces at an average of
$1,258 per ounce (Q1 2017: 8,283 ounces at an average of $1,220 per
ounce)
-- Q2 2017 copper concentrate shipments to the customer totalled
3,166 dry metric tonnes ("dmt") with a sales value of $6.1 million
(excluding Government of Azerbaijan production share) (Q1 2017:
2,230 dmt with a sales value of $4.4 million)
Operational update
-- Water treatment plant installation is complete and commissioning to start imminently
-- Development of Ugur deposit progressing on schedule with
anticipated commencement of mining in Q4 2017
-- Ugur development update by RNS news release expected before the end of July 2017
Company financials
-- Net debt, being interest-bearing loans and borrowings, less
cash and cash equivalents, totalled $29.0 million at 30 June 2017
($33.1 million at 31 March 2017)
Anglo Asian CEO Reza Vaziri commented, "This has been a strong
quarter for Anglo Asian with a 7 per cent. increase in production
to 14,775 ounces expressed as gold equivalent ounces despite the
introduction of our production optimisation activities which we had
anticipated would temporarily impact our production profile. Our
net debt also continues to decrease. The continuation of mining
activities at the Gedabek open pit, whilst simultaneously
developing the new open pit at the Ugur deposit, was possible due
to careful utilisation of equipment and personnel. Maintaining
production during this phase of optimisation is a significant
achievement for Anglo Asian and puts us in a strong position as we
look to increase production from current levels with the
introduction of ore from Ugur in Q4 2017.
"Our forecast for FY 2017 remains at between 64,000 ounces and
72,000 ounces whilst we continue our production optimisation
programme, providing a very solid platform for us to build on in
2018 and beyond."
Production and sales details
The Company has continued in Q2 2017 with its strategy for 2017
as announced on 18 April 2017. This strategy was in response to ore
mined from the open pit in H2 2016 having a lower gold grade and a
higher percentage of copper than ore previously mined. An extensive
programme of exploration and production optimisation is therefore
being carried out in 2017. Ore production from a new open pit at
the Ugur gold deposit discovered in 2016 is also planned to start
before the end of the year. The Company will also process part of
its 1.1 million tonnes of high copper content ore stockpiles in
2017. To process this stockpiled ore, the flotation plant is being
used to treat the ore to remove copper prior to leaching. Mining
will be temporarily reduced or stopped in the open pit during 2017
and approximately 15,000 metres of drilling will be carried out in
furtherance of this programme.
During Q2 2017, the Company mined 336,096 tonnes of ore from its
Gedabek open pit (Q1 2017: 398,028 tonnes of ore from its Gedabek
open pit). Continued mining was made possible during the quarter
due to careful utilisation of equipment and human resources. 9,591
tonnes of ore with an average grade of 5.17 grammes per tonne was
also mined, in conjunction with its exploration programme, from the
Gadir underground mine in Q2 2017.
As previously reported, low grade ore (less than 1.5 grammes per
tonne of gold) is being treated by heap leaching, whilst higher
grade ore (more than 1.5 grammes per tonne of gold) is being
processed through the combined agitation leaching and flotation
plants.
During Q2 2016, the Company stacked 162,147 tonnes of dry
crushed ore onto heap leach pads with an average gold grade of 1.05
grammes per tonne (Q1 2017: 110,348 tonnes with an average gold
content of 1.00 grammes per tonne). The Company also heap leached
uncrushed (Run of Mine - "ROM") ore. During Q2 2017, the Company
stacked 115,559 tonnes of ROM ore onto heap leach pads with an
average gold grade of 0.89 grammes per tonne (Q1 2017: 103,622
tonnes with an average gold grade of 0.87 grammes per tonne).
During Q2 2017, the Company processed 179,454 tonnes of ore with
an average gold content of 1.77 grammes per tonne through the
combined agitation leaching and flotation plants (Q1 2017: 184,074
tonnes of ore with an average gold content of 1.52 grammes per
tonne). Of the ore processed, 108,417 tonnes were mined during Q2
2017 from the open pit and the Gadir and Gosha underground mines
and 71,037 tonnes were from the Company's stockpiles.
During Q2 2017, the Company produced gold doré containing 9,131
ounces of gold and 3,266 ounces of silver at Gedabek. The agitation
leaching plant produced 4,606 and 1,641 ounces of gold and silver,
respectively, and the heap leach operations produced 4,525 and
1,625 ounces of gold and silver, respectively. (Q1 2017, gold doré
containing 9,258 ounces of gold and 2,447 ounces of silver at
Gedabek. The agitation leaching plant produced 5,508 and 1,352
ounces of gold and silver, respectively, and the heap leach
operations produced 3,750 and 1,095 ounces of gold and silver,
respectively).
Operational update
The Company continues to make solid progress with its water
treatment plant and installation of the plant is finished.
Commissioning is expected to start imminently and take around two
weeks to complete.
Development of the new Ugur gold deposit continues on schedule
with good progress being made building the road between the deposit
and the Company's processing facilities. A full update on the
exploration and development activities at Ugur is anticipated by
RNS news release before the end of July 2017.
Production Details
The following table summarises gold doré production and sales at
Gedabek for FY 2016 and H1 2017:
Gold produced* Silver Gold sales** Gold Sales
(ounces) Produced* (ounces) price
(ounces) ($/ounce)
Quarter ended
31 March 2016 13,383 1,958 12,143 1,184
30 June 2016 17,926 2,983 15,661 1,265
H1 2016 31,309 4,941 27,804 1,230
30 Sept 2016 15,407 2,502 12,567 1,332
31 Dec 2016 14,221 2,845 12,995 1,227
H2 2016 29,628 5,347 25,562 1,278
FY 2016 60,937 10,288 53,366 1,253
31 March 2017 9,258 2,447 8,283 1,220
30 June 2017 9,131 3,266 7,406 1,258
H1 2017 18,389 5,713 15,689 1,238
-------------- -------------- ----------- ------------- ----------
* including Government of Azerbaijan's share
** excludes Government of Azerbaijan's share
The following table summarises copper concentrate production
from both its SART and flotation plants at Gedabek for FY 2016 and
H1 2017:
Concentrate Copper Gold Silver
production* content* content* content*
2016 (dmt) (tonnes) (ounces) (ounces)
Quarter ended 31
March
SART processing 363 181 12 7,789
Flotation** 1,458 200 607 19,055
Total 1,821 381 619 26,844
Quarter ended 30
June
SART processing 373 195 4 10,047
Flotation** 1,988 302 1,445 39,184
Total 2,361 497 1,449 49,231
Quarter ended 30
Sept
SART processing 418 225 4 7,291
Flotation 1,426 260 1,123 24,106
Total 1,844 485 1,127 31,397
Quarter ended 31
December
SART processing 445 219 7 6,751
Flotation 2,059 359 1,255 40,620
Total 2,504 578 1,262 47,371
2017
Quarter ended 31
March
SART processing 428 210 5 5,523
Flotation 2,312 396 1,815 31,399
Total 2,740 606 1,820 36,922
Quarter ended 30
June
SART processing 418 187 4 4,717
Flotation 3,273 529 3,005 37,735
Total 3,691 716 3,009 42,452
------------------ ------------ --------- --------- ---------
* including Government of Azerbaijan's share.
** certain amounts for flotation production are different to
those previously disclosed due to final reconciliation of
production and sales.
The following table summarises copper concentrate production and
sales at Gedabek for FY 2016 and H1 2017. Note that sales of
concentrates are initially recorded at provisional amounts until
agreement of final assay:
Concentrate Copper Gold Silver Concentrate Concentrate
production* content* content* content* sales** sales**
(dmt) (tonnes) (ounces) (ounces) (dmt) ($000)
Quarter
ended
31 March
2016 1,821 381 619 26,844 1,319 2,137
30 June
2016 2,361 497 1,449 49,231 1,582 2,977
H1 2016 4,182 878 2,068 76,075 2,901 5,114
30 Sept
2016 1,844 485 1,127 31,397 1,782 3,612
31 Dec
2016 2,504 578 1,262 47,371 2,147 3,865
H2 2016 4,348 1,063 2,389 78,768 3,929 7,477
FY 2016 8,530 1,941 4,457 154,843 6,830 12,591
31 March
2017 2,740 606 1,820 36,922 2,230 4,424
30 June
2017 3,691 716 3,009 42,452 3,166 6,104
H1 2017 6,431 1,322 4,829 79,374 5,396 10,528
---------- ------------ --------- --------- --------- ------------- --------------
* including Government of Azerbaijan's share
** excludes Government of Azerbaijan's share
The Company had net debt at 30 June 2017 of $29.0 million, a
reduction of $4.1 million since 31 March 2017. The net debt at 30
June 2017 was as follows:
$m
Amsterdam Trade Bank - Agitation plant
loan 6.2
Gazprombank - Agitation plant loan 6.2
International Bank of Azerbaijan - loan 3.9
International Bank of Azerbaijan - credit
line 0.5
Atlas Copco equipment finance loan 0.5
YapiKredit 2.6
Pasha Bank 6.2
Kapital bank 0.5
Director 3.8
Total loans 30.4
Cash on hand and at bank (1.4)
Net debt 29.0
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
**ENDS**
For further information please visit www.angloasianmining.com or
contact:
Anglo Asian Mining Tel: +994 12 596
Reza Vaziri plc 3350
-------------------- ------------------- ------------------
Anglo Asian Mining Tel: +994 502 910
Bill Morgan plc 400
-------------------- ------------------- ------------------
Ewan Leggat SP Angel Corporate Tel: +44 (0) 20
Finance LLP 3470 0470
Nominated Adviser
and Broker
-------------------- ------------------- ------------------
Soltan Tagiev SP Angel Corporate Tel + 44 (0) 20
Finance LLP 3470 0470
-------------------- ------------------- ------------------
Susie Geliher St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
-------------------- ------------------- ------------------
Lottie Brocklehurst St Brides Partners Tel: +44 (0) 20
Ltd 7236 1177
-------------------- ------------------- ------------------
Notes:
Anglo Asian Mining plc (AIM:AAZ) is a gold, copper and silver
producer in Central Asia with a broad portfolio of production and
exploration assets in Azerbaijan. The Company has a 1,962 square
kilometre portfolio, assembled from analysis of historic Soviet
geological data and held under a Production Sharing Agreement
modelled on the Azeri oil industry.
The Company developed Azerbaijan's first operating
gold/copper/silver mine, Gedabek, which commenced gold production
in May 2009. Gedabek is an open cast mine with a series of
interconnected pits. The Company also operates the high grade Gadir
underground mine which is co-located at the Gedabek site. The
Company has a second underground mine, Gosha, which is 50
kilometres from Gedabek. Ore mined at Gosha is processed at Anglo
Asian's Gedabek plant.
Gold production for the year ended 31 December 2016 from Gedabek
totalled 65,394 ounces with 1,941 tonnes of copper also produced.
Gedabek is a polymetallic deposit and its ore has a high copper
content, and as a result the Company produces copper concentrate
from its Sulphidisation, Acidification, Recycling, and Thickening
(SART) plant. Anglo Asian also produces a copper and precious metal
concentrate from its flotation plant, which is processing tailings
from the agitation leach plant.
Anglo Asian is also actively seeking to exploit its first mover
advantage in Azerbaijan to identify additional projects, as well as
looking for other properties in order to fulfil its expansion
ambitions and become a mid-tier gold and copper metal production
company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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